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Colorado Court Grants Taxpayers’ Motion as to Healthcare Tax

July 27, 2017 – DENVER, CO. A Colorado group that defends the rights of taxpayers today celebrated the ruling by a Denver District Court accepting its amended and supplemental complaint against Colorado agencies and their officials for violating the Colorado Constitution’s Taxpayer’s Bill of Rights (TABOR).

The TABOR Foundation filed its motion on June 30, 2017. Two years earlier, on June 26, 2015, the TABOR Foundation filed its initial lawsuit charging its members should have been allowed to vote on whether a “hospital provider fee” may be imposed on Colorado hospitals; since 2009 Colorado’s Department of Health Care Policy and Financing has collected tens of millions and perhaps even a hundred million dollars.

Federal law lets States impose healthcare assessments to pay for Medicaid services, but the regulations provide for “taxes” and not “fees” as Colorado calls them to avoid TABOR. Although the 2009 act says the funds will be kept separate from the general fund, in fiscal years 2010, 2011, 2012, and 2013 some of the tax proceeds were put in the general fund.

The TABOR Foundation sought an end to the tax and refund of revenues collected, with interest, as required by TABOR. As of October 16, 2015, a motion by the Colorado defendants to dismiss the lawsuit had been briefed fully. On May 30, 2017, however, Governor Hickenlooper signed into law S.B. 17-267, which created the Colorado Healthcare Affordability and Sustainability Enterprise to administer the Hospital Provider Charge beginning on July 1, 2017. All of the TABOR Foundation’s 2015 claims remain virtually identical, except for the new challenge to creation of the “Enterprise.”

DENVER – Transportation funding in Senate Bill 17-267, that was billed as the “Sustainability of Rural Colorado” Act, may in fact filter to more-populated areas if a newly-formed association made up of like-minded county commissioners has anything to say about it.

SB 267 was rushed through with more than 70 pages of strike below in the waning moments of the 2017 legislative session. It was billed as the “Grand Deal” by its supporters and the “Grand Betrayal” by its detractors.

There is no doubt it was controversial throughout the process because it involved reclassifying the Hospital Provider Fee from a Taxpayer’s Bill of Rights (TABOR) governed account to an enterprise, non-TABOR restricted account. It also put into use Certificates of Participation (COPs), which some believe are an end around TABOR. Some also believed it violated Colorado’s single-subject law for new legislation.

Since it was signed into law and took effect July 1, Complete Colorado broke the news that a drafting error would cost special taxing districts such as the Regional Transportation District (RTD) and the Scientific and Cultural Facilities District (SCFD), which funds the Denver Zoo and the Denver Museum of Nature and Science, millions in revenue.

Complete Colorado has also learned that an organized group of county commissioners called Counties and Communities Acting Together (CCAT) see the new law as a stepping stone to further weaken TABOR.

The judicial branch exists primarily to ensure that Constitutional principles are properly upheld by the courts. And yet, constitutional victories have been troublingly rare as of late. But even though limited government and a true separation of powers seems almost non-existent, the United States District Court for the District of Columbia just handed down a precedent-setting decision that is a win for anyone who supports constitutional limits to state power.

In the class action suit of Steele v. United States, the Court ruled that the IRS would be required to return an estimated $270 million in “user fees” charged to Americans in what a U.S. District Court determined was an unlawful expansion of the agency’s authority.

The Court ruled that occupational licensing was outside the IRS’ scope of authority.

In 2010, the Treasury Department and the IRS issued a tangle of new regulations, including a requirement that tax preparers register for a specific ID number (PTIN) to be entered on all returns. For anyone who had previously been preparing tax returns for others without a state-sanctioned “professional” preparer’s status, this new regulation required them to pass a competency exam before receiving the required PTIN.

June 30, 2017 – DENVER, CO. A Colorado group that defends the rights of taxpayers today filed a motion to amend and supplement its complaint against two Colorado entities and their officials for violation of the Colorado Constitution’s Taxpayer’s Bill of Rights (TABOR). On June 26, 2015, the TABOR Foundation alleges in Denver County Court that its members should have been allowed to vote on whether a “hospital provider fee” could be imposed on Colorado hospitals, which since its enactment in 2009, allowed Colorado’s Department of Health Care Policy and Financing to collect tens of millions and perhaps even a hundred million dollars. Although federal law lets States impose healthcare assessments to pay for Medicaid services, the regulations provide for “taxes” and not “fees” as Colorado calls them to avoid TABOR. Also, although the 2009 act provided that the funds collected would be kept separate from the general fund, in fiscal years 2010, 2011, 2012, and 2013 some of the tax proceeds were put in the general fund. The Foundation sought declaratory and injunctive relief and refund of revenues collected, with the payment of interest, as required by TABOR. As of October 16, 2015, a motion by the Colorado defendants to dismiss the lawsuit had been briefed fully. On May 30, 2017, Governor Hickenlooper signed into law S.B. 17-267, which created the Colorado Healthcare Affordability and Sustainability Enterprise to administer the Hospital Provider Charge beginning on July 1, 2017; however, except for the insertion of the Enterprise in this purportedly unconstitutional endeavor, all of the Foundation’s 2015 claims for relief remain virtually identical.

Little ole Colorado, you’ve done well for yourself. You were a collection of cow towns when I first moved here in 1988. It was said that yogurt was the only culture in Colorado, and cowboys don’t eat yogurt.

Colorado is wealthy. Not DC wealthy, but quite a step up from the late 80’s. We rank 11th for median household income, have the 10th lowest unemployment rate, and the 14th lowest poverty rate. We have the Denver Performing Arts Center, and a growing system of subsidized trains. Colorado is also healthy, ranking 10th.

One reason we have done well is our restrained state government. With our balanced budget requirement and the Taxpayer’s Bill of Rights (TABOR), government has a tough time taking more of our money. That means greater economic growth.

But 70% of our state’s roads and bridges are in poor or mediocre condition, and getting worse. And, despite all that wealth and health, 1 in 4 Coloradans depend on the government for healthcare (Medicaid). The legislature wants more of your money, and is willing to close down hospitals to keep it.

The most cynical move of all

The legislature argued for several years about the Hospital Provider Fee, an $800 million program, claiming it is solely responsible for exceeding TABOR revenue limits, a situation that would require refunds to taxpayers. (Yes, it’s actually a tax. They just call it a fee so they don’t have to ask permission to take the money.) But every revenue source is equally to blame for exceeding the limit. To appease their insatiable appetite for more revenue, the legislature moved the program out of the general fund so it is not subject to the revenue limits. This is a crafty, deceptive scheme to avoid asking permission from voters to take more money, and to avoid refunding excess collections. They threatened to close rural hospitals if they didn’t get their way.

TABOR requires a change to the revenue limit if a program’s costs are moved off the books. It also requires TABOR to be interpreted to “reasonably restrain most the growth of government.” Instead of lowering the limit by $800 million, it was lowered only $200 million, resulting in a permanent $600 million per year tax increase. (The $800 million will still be spent, but outside of the budget, leaving more room in the budget, and more taxpayer dollars to be taken and spent.) Senate President Kevin Grantham (R, Canon City) believes that as long as there is a change, he has met the constitutional requirement. Continue reading →

“But the biggest agreement of the day came on SB 267, a bill that attempts to meet several of the most crucial needs in Colorado — increased road funding, stabilized funding for rural hospitals, a boost in funding for rural schools — as it also allows for more spending room in future budgets.

Several House Republicans blasted the bill, which largely was crafted by Republican Sen. Jerry Sonnenberg of Sterling. They said it violated the Taxpayer’s Bills of Rights by not reducing the TABOR spending cap by as much as the cost of the roughly $800 million hospital provider fee program that it took out from under the cap and made into an enterprise.

Rep. Tim Leonard, R-Evergreen, said it also violated the legislative requirement to limit all bills to a single subject, even as it seemed to try to fill the needs of many sectors to grow their government funding.

“We work for the people,” Leonard told House members. “We do not work for the recipients of government money waiting for the trough to fill up with taxpayer money.”

But a number of other Republicans, who largely represent rural areas or are considered more moderate members of their caucus, said they backed the measure because the spending recipients needed the boost. They echoed arguments from the Colorado Hospital Association that between six and 12 rural hospitals could close if they lost the money originally projected to be taken from them in order to balance the budget next year.

And several blasted conservative organizations who have criticized them for going along with the plan, saying they are out of touch with constituents’ needs and are making the Legislature a place that is run by fear.

“I know by the time I get back to my desk, the Facebook posts will start. We’ve heard them already: ‘Squish, RINO,’” said Rep. Lois Landgraf, R-Fountain, referring to the acronym some groups give to elected officials they consider to be Republican In Name Only.

“What’s not OK is that by the time I walk out of here, I will have earned myself a primary. But I am happy to be a ‘yes’ vote.”“

Over the course of a turbulent 13-hour final day of the 2017 session Wednesday, the Colorado Legislature passed one the most wide-ranging omnibus spending bills in recent memory and then killed off the vast majority of functions of the Colorado Energy Office.

The 120th day of the first session of the 71st General Assembly began with broad bipartisan support over Senate Bill 267, a measure that saves Colorado hospitals from $528 million in funding cuts, dedicates $1.88 billion to highway projects, pares Medicaid spending and offers a personal property tax credit to businesses for their first $18,000 worth of business equipment.

Despite protests from some Republicans that some of its spending maneuvers were unconstitutional, nearly half of the caucus joined with House Democrats in passing the bill by a 49-16 margin and sending it onto Gov. John Hickenlooper.

But that was about the only kumbaya moment of a day that descended into endless negotiations and then finger-pointing over two issues key to businesses in rural Colorado.

By the time the state House of Representatives adjourned at 9:39 p.m., the Legislature had rolled back a bill to increase funding for rural broadband.

No gas for Energy Office

They also had failed to pass a reauthorization bill for the Colorado Energy Office, meaning that the majority of the office’s functions and its 24-person staff will disappear July 1. Continue reading →

KERR-TAILED: Andy Kerr’s TABOR End-Run Lawsuit Meets Timely Death

Yesterday, a district court judge dismissed a lawsuit brought forward by Democratic state Sen. Andy Kerr, who is running to replace fellow Democrat Ed Perlmutter. The ruling was a huge victory for taxpayers and the lawsuit was the height of hubris by Kerr and Company. Here’s what we wrote about the lawsuit last month, when Kerr announced his run for Governor:

“The case has not been resolved and is still working its way through the court system, but the crux of the case is that Andy Kerr, represented by liberal U.S. Rep. Diana Degette’s husband Lino Lipinsky, believes that TABOR, or the taxpayer bill of rights, violates a representative government. Has Kerr been a passionate advocate for representative government in the past? No. In essence, he’s searching for any reason to undermine TABOR. Here’s what the Denver Post‘s then-editorial page editor, Vincent Carroll, wrote in 2013 about the case:

“They wish to be the sole authority in Colorado on ‘all questions [my emphasis] of timing, method, nature, purpose, extent, and priority with respect to the imposition of taxes or the appropriation of funds.’

“They say this in a legal brief filed recently in support of a lawsuit urging federal courts to strike down the Taxpayer’s Bill of Rights as an unconstitutional infringement on legislative power.”

This is just disgusting. Given his obvious attempt at a power grab, Kerr should be rejected by any voter that does not consider him or herself a radical leftist. Here’s what Senate President Kevin Grantham had to say about the ruling:

“Senate Republicans applaud the district court’s decision to dismiss this case, which clearly was aimed at end-running and undermining, through sly legal maneuvers, the will of voters who wrote TABOR into the State Constitution. If TABOR foes are sure Coloradans no longer support the taxpayer protections and fiscal discipline TABOR provides, they should stop waging these guerilla wars and put a repeal measure on the ballot. They don’t do so because they know Coloradans continue to support the spirit and letter of this law.”

Grantham is right. Leftists don’t have the votes to pass this ill-advised potential ballot initiative, and Coloradans love the idea that TABOR represents. This blatant cash grab should be enough to disqualify Kerr from higher office.

DENVER (AP) — A federal judge has dismissed a long-running lawsuit challenging Colorado’s strict tax and spending limits as unconstitutional but more appeals are possible.

U.S. District Judge Raymond Moore ruled Thursday that none of the former or current elected officials, educators or citizens challenging the 1992 Taxpayer’s Bill or Rights or TABOR have proved they were harmed by it. As a result, he said they don’t have the right to challenge the voter-approved measure in court.

TABOR also requires tax increases to be approved by voters. Challengers say that violates the U.S. Constitution, which guarantees a republican form of government in each state where elected officials make decisions.

The lawsuit was filed in 2011. Along the way, part of it was considered by the U.S. Supreme Court, which sent the case back to court in Denver.